Not mistakes.. Opportunities!

Not mistakes.. Opportunities!

Great Article. Sound familiar?

The first and perhaps the most predominant area of concern is the hesitation to adopt new technology. Accounting has always been looked upon as a miserable and boring job. Accountants bear a scar of being “bean counters” that are only concerned with figures, and with the hesitation they exhibit in accepting new technology one can understand how this stereotype can become reinforced. The leap in technology in the last 20 years has been so great that a standardized profession like accounting fumbles to embrace the changes. Nevertheless, accountants need to understand and adopt these technologies as it will not only benefit them financially but will also lead to the evolution of the profession as whole.

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You’re the Millennial – have you given any thought to becoming part of the firm’s succession plan?????

This is a matter that most accountants know is inevitable yet still refuse to acknowledge until it may be too late. With the baby boomers starting to reach the age of retirement, the likely scenario is the number of small to medium sized accounting practices will begin to shrink. To avoid this it is advisable for accountants to start considering a succession plan right away. Succession planning has multiple options ranging from mergers, acquisitions to partnerships and more. However, the crucial factor is to start planning for these set-ups. The majority of accountants want to keep growing their business and continue being profitable but without a good succession plan in place, much of that effort may go in vain.

Outsourcing data entry? Better yet, empower the client to give it to you in a way that’s efficient for you to use.

As an accountant this may not seem like a matter of concern, in fact, for many it is just a part of the job. Which indisputably is true but it also is a key area for cost savings. An accountant possesses a unique skill set that should be put to proper use. Accountants lose their true potential doing time-consuming tasks such as data entry, and this is a prime part of the workload that could be outsourced to other companies. Doing this could result in huge cost savings and deliver the greater benefit, the amount of time it will free up to focus on more profitable areas such as consultancy and advisory/planning work.

About Brian Lefever

As VP of Operations - Brian is responsible for continuous product development for Titan Echo. Proudly engineering a simple and cost effective solution for CPAs to provide Cost Segregation benefits to their clients.

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The third piece of Cost Seg is Legal Analysis. Once Echo has the costs for all the items, it needs to evaluate each item under the current Cost Seg body of law. This process without a doubt is vital and quite complicated. Although it has evolved, there is conflict in the law, it’s a little dicey.

Echo has to leverage court cases against the facts and circumstances of your property, to determine which items can be reclassified from Section 1250 real property to Section 1245 personal property.

Then it applies what’s called the MACRS Asset Classification System accordingly. Then Echo can recompute depreciation based on each item’s life, method and convention, and calculate that catch-up depreciation, if available.

Ultimately, Echo will be able to complete the complicated tax Form 3115 – Change in Accounting Method to be included in the owner’s next tax return.

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Learn More: Construction Cost Estimating

The second step in Cost Seg is Construction Cost Estimating (CCE). Echo is going to review the supporting documents you gather – and extract any pertinent project data. Echo then does quantity takeoffs from the drawings (if you have any) – and your pictures from the field.

In the CCE step – Echo’s construction cost analysis is going to use your submitted info to build up the cost to re-build the building submitted. If you built the building (or you have actual costs) Echo will use that data, but if you don’t, we’ll rely on our database of national construction cost data.

Echo has the construction experience to determine what it would cost to build that building today, as it sits when you did the OSV. This concept is called “Reconstruction Cost New”, or “RCN”. This is a very important legal concept. There are consultants out there that don’t do it right. They do not account for all the pieces and parts of the project. They only account for the items that they believe can be reclassified as personal property.

However, until you gain ALL of the pieces – including the total cost (RCN) – and then pro-rate all these costs so it adds up to what the investor actually paid for it – you don’t really know what the cost of the these personal property items actually is. So once Echo has the RCN – we will do the proration – so that everything ties out of the basis of the building that’s currently on the Fixed Asset Schedule.

[ CLOSED WINDOW ]

Learn More: Legal Analysis

Echo has to leverage court cases against the facts and circumstances of your property, to determine which items can be reclassified from Section 1250 real property to Section 1245 personal property.

Then it applies what’s called the MACRS Asset Classification System accordingly. Then Echo can recompute depreciation based on each item’s life, method and convention, and calculate that catch-up depreciation, if available.

Ultimately, Echo will be able to complete the complicated tax Form 3115 – Change in Accounting Method to be included in the owner’s next tax return.

In the CCE step – Echo’s construction cost analysis is going to use your submitted info to build up the cost to re-build the building submitted. If you built the building (or you have actual costs) Echo will use that data, but if you don’t, we’ll rely on our database of national construction cost data.

Echo has the construction experience to determine what it would cost to build that building today, as it sits when you did the OSV. This concept is called “Reconstruction Cost New”, or “RCN”. This is a very important legal concept. There are consultants out there that don’t do it right. They do not account for all the pieces and parts of the project. They only account for the items that they believe can be reclassified as personal property.

However, until you gain ALL of the pieces – including the total cost (RCN) – and then pro-rate all these costs so it adds up to what the investor actually paid for it – you don’t really know what the cost of the these personal property items actually is. So once Echo has the RCN – we will do the proration – so that everything ties out of the basis of the building that’s currently on the Fixed Asset Schedule.